Risk and uncertainty

The Stoic’s guide to risk management

One of the things that first got me thinking more constructively about risk management was the problem of how to best deal with risk and uncertainty. In 2014 I wrote about how to think about risk differently, which led to finding better ways to deal with it. Since then I’ve written about creating opportunities, seeking different perspectives, and more.

Some time ago a friend captured a lot of related ideas in a single concept, which it turns out has a long history. I was commenting that I thought his particular job was very difficult, as his success relied heavily and directly on the decisions of others, and he said it became much easier when viewed through the lens of the Stoic philosphers. In particular, he pointed me to the trichotomy of control.

The trichotomy of control is a simple idea: there are things you can control (what to eat, what to say, etc), and there are things you can’t control (the weather, what other people think, etc). But in between there is a thin sliver of things you can influence.

The first page I came across on Google for this gave the example of a job interview. You can’t control what the interviewers ask, or who they ultimately choose for the job, but you can influence their choice with things you can control: by taking time to understand what they want and their business, by researching the field, by turning up in good time, and so on.

Ultimately this is a form of risk management. We cannot control many things, but we can influence them, perhaps including how they happen, when they happen, and their consequences. It’s tempting to think our processes and heuristics for the modern world are themselves modern, but it seems some of the best ideas are the oldest.

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